Harvard Business Review

MAY 8, 2012

Cloud service providers are increasingly proxies for utilities — they require 100% uptime, significant quantities of their own power, and predictable variable cost (which for renewables is nearly zero). Sales/Becoming the Vendor of Choice.

Energy 22

Energy Variable Costs Travel Operations 22

Harvard Business Review

MAY 8, 2012

Bharti's innovative business model converted fixed costs in capital expenditure to a variable cost based on usage of capacity. Through the outsourcing arrangements, Bharti dramatically lowered its costs while ensuring high quality for customers, since vendors had world-class competencies in their domains.

Balance Sheet 16

Balance Sheet Variable Costs Telecommunications Fixed Costs 16

Harvard Business Review

OCTOBER 29, 2015

This makes financial sense in industries with high fixed costs and low variable costs: larger sizes enable the company to charge higher prices that, even if they are just slightly larger, absorb a higher portion of fixed costs, while reducing packaging cost per volume and attracting value-minded consumers.

Fixed Costs 15

Fixed Costs Variable Costs Marketing Sales 15

Harvard Business Review

OCTOBER 14, 2014

Second, because they can’t yet afford the high-margin top brands, they’re not all that attractive to incumbents worried about generating enough cash to cover their high fixed and variable costs. Through an online retailer called Flipkart, potential buyers preregister for a short sales window.

Variable Costs 15

Variable Costs Sales Sales Marketing 15

Harvard Business Review

JULY 9, 2014

Uber is further capitalizing on this uneven pricing field by running sales this summer. Thus, Uber is pricing below its variable costs. Conversely, during peak times, Uber can dynamically raise its prices while taxis are tied to the same static one-size-fits-all rates.

Variable Costs 11

Variable Costs Transportation Government Telecommunications 11

Harvard Business Review

MARCH 11, 2014

First, making significant amounts of your own power at zero variable cost is more than nice; it’s a hedge against volatility and smooths out expenses, which makes business planning easier. In addition, the story you tell customers can affect sales.

ROI 15

ROI Variable Costs Energy Benefits 15

Harvard Business Review

SEPTEMBER 22, 2015

The biggest expense of a new drug is R&D; once developed, the cost of producing pills is relatively trivial. Most important, everyone in the world can – and should – benefit from pharmaceutical advancements, especially since the variable costs are so low. the government simply specifies prices).

Variable Costs 15

Variable Costs Insurance Government Benefits 15

Harvard Business Review

JANUARY 27, 2015

Amazon’s Jeff Bezos recommends looking for opportunities to convert capital and fixed expenses into variable costs. So look for industries where upfront costs are high and new technology could offer similar services with little or no upfront commitment. ” But with time this can be overcome.

Small Business 15

Small Business B2B Variable Costs Scaling 15

Harvard Business Review

OCTOBER 25, 2017

This profusion of products means that Philips is cash-rich, yet sales have stagnated in the last decade, and concerns about the company have been reflected in its stock price. Revenues will be generated progressively over long periods of time, instead of right after the sale of a product. Sales force. Pricing model.

Revenue 8

Revenue Variable Costs Sales Sales 8

Harvard Business Review

APRIL 5, 2013

Dynamic pricing makes sense for baseball as it shares key qualities that have enabled other industries (airlines, hotels, and rental cars) to prosper from this strategy: fixed capacity, low variable costs, and a "product" that expires at a certain time. Just as important, revenue doesn''t solely come from ticket sales.

Variable Costs 8

Variable Costs Travel Revenue Sales 8

Harvard Business Review

MAY 18, 2018

per month per subscriber, and three movie tickets costs nearly $30, on average, meaning it’s losing nearly $20 per month per subscriber on a variable cost basis. Ticket sales don’t cover the costs of operating a theater.) The problem is that MoviePass collects only $9.95

Advertising 8

Advertising Variable Costs Revenue Operations 8

Harvard Business Review

AUGUST 3, 2018

The company should separately present fixed and variable costs, and to the extent possible, detail the variable costs associated with a unit of activity. For example, Twitter provides “cost per ad engagement.” Investors should have access to those estimates, too.

Variable Costs 8

Variable Costs Revenue Assets Cash Flow 8

Harvard Business Review

FEBRUARY 22, 2011

As each of these companies expands its fixed-cost infrastructure, profits grow geometrically because the additional variable cost of adding each new user is near zero. Adding a profile on Facebook has little to no impact on Facebook's operating costs. They're out to kill the cost-per-thousand or CPM-based ad sales model.

Advertising 22

Advertising Variable Costs Scaling Media 22

Harvard Business Review

NOVEMBER 30, 2018

Car sales in the U.S. But car sales are now probably past a cyclical peak, not only in the U.S. Capital-intensive factories have a high-fixed-cost, low-variable-cost operating model. GM has good immediate reasons for its decisions.

Fixed Costs 15

Fixed Costs Assets Cash Flow Variable Costs 15